R. L. Nkumbwa Copperbelt University. Outline Entrepreneurs Entrepreneurs Their Environment Their...

R. L. NkumbwaR. L. NkumbwaCopperbelt UniversityCopperbelt University

OutlineOutline• EntrepreneursEntrepreneurs

• Their EnvironmentTheir Environment

And And

Entrepreneurs – The New AlchemistsEntrepreneurs – The New AlchemistsEnterpriseEnterprise – adventure, effort, endeavour, project, undertaking, scheme, venture, daring, energy, initiative, push.

EnterprisingEnterprising – adventurous, audacious, bold, daring, active, alert, efficient, energetic, prompt, resourceful, smart, spirited, zealous.

EntrepreneurEntrepreneur – person in control of commercial undertaking, one who undertakes a business or enterprise, with a chance of profit or loss.

Leap Leap and the and the net will net will appearappear

Julia Julia CameronCameron

Innovation = Creativity x Risk TakingInnovation = Creativity x Risk Taking

Five is a magic number: Five is a magic number: wanted four cornerstoneswanted four cornerstones

…… …… and an entrepreneurand an entrepreneur

““An entrepreneur is someone An entrepreneur is someone who perceives an opportunity who perceives an opportunity and creates an organisation to and creates an organisation to

pursue it”pursue it”

Bill Bygrave Bill Bygrave (The Portable MBA in Entrepreneurship, 1994)(The Portable MBA in Entrepreneurship, 1994)

““An entrepreneur is someone An entrepreneur is someone who accepts the risk of acquiring who accepts the risk of acquiring and organising resources to seek and organising resources to seek

opportunities for profit.”opportunities for profit.”

David Gough, Entrepreneur and MentorDavid Gough, Entrepreneur and Mentor

White Rose Bioscience Forum, York, White Rose Bioscience Forum, York,

6 November, 20026 November, 2002

An entrepreneur is someone who An entrepreneur is someone who habitually creates and innovates habitually creates and innovates to build something of recognised to build something of recognised value around perceived value around perceived opportunities.opportunities.

Bill Bolton & John ThompsonBill Bolton & John ThompsonEntrepreneurs – Talent, Temperament, TechniqueEntrepreneurs – Talent, Temperament, Technique

What are the Characteristics of the What are the Characteristics of the Entrepreneur?Entrepreneur?

• Perseverance and DeterminationPerseverance and Determination•Ability to take RisksAbility to take Risks•Need achieve/Make a DifferenceNeed achieve/Make a Difference•Initiative and taking ResponsibilityInitiative and taking Responsibility•FocusFocus•CreativityCreativity•Honesty and IntegrityHonesty and Integrity•IndependenceIndependence

What do Entrepreneurs do?What do Entrepreneurs do?• They make a significant differenceThey make a significant difference• They create and innovateThey create and innovate• Spot and exploit opportunitiesSpot and exploit opportunities• Find the necessary resourcesFind the necessary resources• NetworkNetwork• Show determination in the face of adversity Show determination in the face of adversity • Manage riskManage risk• Exercise control over the enterpriseExercise control over the enterprise• Be customer orientedBe customer oriented•Create CapitalCreate Capital

So basically Entrepreneurs…..So basically Entrepreneurs…..

• to Createto Create

• Innovate andInnovate and

• BuildBuild

• Take Risks in order….Take Risks in order….

The ‘Entrepreneur’ Process DiagramThe ‘Entrepreneur’ Process Diagram

1. Motivation to make a Difference

3. Spotting and

Exploting opportunities

Overcoming

Obstacles

8. Controlling the business

9. Putting the customer first

10. Financial, Social,

aesthetic capital

2. Creativity and Innovation

Recognition Of Value

4. Finding the required

resources

5. Using networks

extensively

6. Showing determination in the face of adversity

7. Managing risk

Bill Bolton & Bill Bolton & John ThompsonJohn ThompsonEntrepreneurs – Entrepreneurs – Talent, Talent, Temperament, Temperament, TechniqueTechnique

From “Idea” to “Opportunity”From “Idea” to “Opportunity”

IdeaIdea

OpportunityOpportunity

Knowledge Knowledge skills and skills and competencycompetency

From: Bill Bolton & John From: Bill Bolton & John ThompsonThompsonEntrepreneurs – Talent, Entrepreneurs – Talent, Temperament, TechniqueTemperament, Technique

The industrial landscape is already littered with remains of once successful companies that could not adapt their strategic vision to altered conditions of competition.

Abernathy, Clark & KantrowAbernathy, Clark & Kantrow

Effective Effective Strategic Strategic positionposition

Factors Factors critical critical for for market market successsuccess

Creative idea

Implemented

Leads to Innovation

Enterprise

Creativity, Innovation and Entrepreneurship

Marketed

What sort of people do you need What sort of people do you need in a Business Start-up Team?in a Business Start-up Team?

• EntrepreneurEntrepreneur

• Technical InnovatorTechnical Innovator

• A Technical Delivery SpecialistA Technical Delivery Specialist

• A Sales personA Sales person

• A Finance/Admin personA Finance/Admin person

TheThe Business Start-up TeamBusiness Start-up TeamEntrepreneur

Delivery Specialist

Sales

Technical Innovator

Finance/ admin

What will they do?What will they do?Entrepreneur: communicates

vision, aims, goals

Delivery Specialist: ensures that goods/services are delivered to the customer on time and to spec: the second ‘techie’

Sales Person: goes out and gets business for the company, another great communicator

Technical Innovator: the ideas person, comes up with new products

Finance/ Admin person: watches the cash and sets up systems

From: From: GSC6001 GSC6001 Entrepreneurship and Entrepreneurship and Business PlanningBusiness Planning

The Entrepreneur’s World: The MarketThe Entrepreneur’s World: The Market

Business has only two basic functions:Business has only two basic functions: Marketing and Innovation. Marketing and Innovation produce results. All the rest are Costs.

Peter F DruckerManagement Guru

What is Marketing?What is Marketing?

MARKETING DEFINED:MARKETING DEFINED:

Marketing isMarketing is ”the management process which identifies, anticipates and supplies

customer requirements efficiently and profitably.”

Chartered Institute of MarketingChartered Institute of Marketing

NEEDS, WANTS, DEMAND AND NEEDS, WANTS, DEMAND AND EXCHANGEEXCHANGE

Market Research

Needs Wants Demand

EEXXCCHHAANNGGEE

Offers for sale Product

From: From: GSC6001 GSC6001 Entrepreneurship and Entrepreneurship and Business PlanningBusiness Planning

The Selling ConceptThe Selling Concept (after Kotler et al (1996)(after Kotler et al (1996)

Starting Starting pointpoint FocusFocus MeansMeans EndsEnds

FactoryFactoryExisting Existing productproduct

Selling & Selling & promotionpromotion

Profits Profits through through sales sales volumevolume

The Marketing ConceptThe Marketing Concept (after Kotler et al(after Kotler et al 1996)1996)

Starting Starting pointpoint FocusFocus MeansMeans EndsEnds

MarketMarket Customer Customer needsneeds

Integrated Integrated marketing marketing

mixmix

Profits Profits through through

customer customer satisfactionsatisfaction

The Entrepreneurial Marketing The Entrepreneurial Marketing Process: Process: the four + four Isthe four + four Is (after Stokes, 2000) (after Stokes, 2000)

Incremental Innovation

Identification of target markets

Interactive marketing methods

Information-gathering through networks

Influence of word of mouth

Image-building

Incentives

Involvement

CREATING CUSTOMER VALUECREATING CUSTOMER VALUE

CUSTOMERCUSTOMER

VALUEVALUE

PERCEIVEDPERCEIVED

BENEFITSBENEFITS

PositivePositive NegativeNegative

•Product benefitsProduct benefits•Service benefitsService benefits•Relational Relational benefitsbenefits•Image benefitsImage benefits

•Monetary costsMonetary costs•Time costsTime costs•Energy costsEnergy costs•Psychological Psychological costscosts

(After Jobber, 2001)(After Jobber, 2001)

PERCEIVEDPERCEIVED

SACRIFICESACRIFICE

The Marketing MixThe Marketing Mix(formerly known as the ‘4 Ps’)(formerly known as the ‘4 Ps’)

• A classification of marketing A classification of marketing decisions made in terms ofdecisions made in terms of

ProductProduct

PricePrice

PromotionPromotion

PlacePlace

PeoplePeople

ProcessesProcesses

Physical evidencePhysical evidence

Positioning Yourself in the Positioning Yourself in the MarketMarket

• Identify characteristics of target marketIdentify characteristics of target market

• Identify factors of critical importance to Identify factors of critical importance to target markettarget market

• Focus all elements of the marketing mix Focus all elements of the marketing mix on that marketon that market

Ten Questions you should be able to Ten Questions you should be able to answer about your Market (1)answer about your Market (1)

1. What is my target market?1. What is my target market?

2. What is the size and accessibility of my target market?2. What is the size and accessibility of my target market?

3. What is the profile of my target customer?3. What is the profile of my target customer?

4. Who are my potential major trade customers?4. Who are my potential major trade customers?

5. How will my products/services solve my customers’ 5. How will my products/services solve my customers’ problemsproblems

Ten Questions you should be able to Ten Questions you should be able to answer about your market (2)answer about your market (2)

6. How does the customer buying process work?6. How does the customer buying process work?

7. What factors will make customers increase or 7. What factors will make customers increase or decrease their buying?decrease their buying?

8. What is my USP (Unique Selling Point)?8. What is my USP (Unique Selling Point)?

9. Can I get a major share of a niche market, rather than 9. Can I get a major share of a niche market, rather than a small share of a large market?a small share of a large market?

10. What are the current trends in the market?10. What are the current trends in the market?

Five Questions you should be able to Five Questions you should be able to answer about your Competitorsanswer about your Competitors

1. Who are my major competitors?1. Who are my major competitors?

2. Where are my major competitors?2. Where are my major competitors?

3. What are the strengths & weaknesses of competitors?3. What are the strengths & weaknesses of competitors?

4. How loyal are customers to current competitors?4. How loyal are customers to current competitors?

5. Who will be my competitors in one year’s time?5. Who will be my competitors in one year’s time?

- Know your Enemy!- Know your Enemy!

Marketing as a Corporate Marketing as a Corporate FunctionFunction

• “ “ Marketing is so basic that it cannot be Marketing is so basic that it cannot be considered to be a separate function. It is considered to be a separate function. It is the whole business seen from the point of the whole business seen from the point of view of its final result; that is the view of its final result; that is the customer’s point of view.”customer’s point of view.”

– Peter DruckerPeter Drucker

Developing a Marketing Strategy:Developing a Marketing Strategy:

• Where are we now?Where are we now? ( (with our products/serviceswith our products/services) ) • Where do we want to be? Where do we want to be? (marketing objectives, (marketing objectives,

targeting, segmentation analysistargeting, segmentation analysis))• How do we get there? (How do we get there? (marketing mix strategies, marketing mix strategies,

resources available)resources available)

• How do we ensure we get there? (How do we ensure we get there? (control & control & feedback)feedback)

Setting Objectives that areSetting Objectives that are SMARTSMART

• SS - SpecificSpecific

• MM - MeasurableMeasurable

• AA - AchievableAchievable

• RR - RealisticRealistic

• TT - To TimeTo Time

Developing a New Product/ Service: Developing a New Product/ Service: StagesStages

• Idea GenerationIdea Generation• Idea ScreeningIdea Screening• Concept Development & TestingConcept Development & Testing• Business AnalysisBusiness Analysis• Product Development & TestingProduct Development & Testing• Test TarketingTest Tarketing• Commercialisation/Mass ProductionCommercialisation/Mass Production

The Product Life CycleThe Product Life Cycle

TimeTime

Sales Sales ZMKZMK

Stage: IntroductionStage: Introduction GrowthGrowth MaturityMaturity DeclineDecline

Customers: Early adoptersCustomers: Early adopters Early majorityEarly majority MajorityMajority LaggardsLaggards

Adoption of an Innovation by different market segments: Adoption of an Innovation by different market segments:

e.g. calculators e.g. calculators (after Jobber, 2001)(after Jobber, 2001)Sales Sales ZMKZMK

TimeTimeEngineers, scientists

Commercial

General public

Schoolchildren

InnovatorsInnovators Early adoptersEarly adopters Early majorityEarly majority LaggardsLaggardsLate majorityLate majority

From: From: GSC6001 GSC6001 Entrepreneurship and Entrepreneurship and Business PlanningBusiness Planning

Everything is worth what its Everything is worth what its purchasers will pay for itpurchasers will pay for it

SyrusSyrus

• Uncovering unmet customer needs Uncovering unmet customer needs and problems and problems

• Match technological capabilities to Match technological capabilities to solving those problemssolving those problems

• Move projects through enterprise Move projects through enterprise and into the marketand into the market

The Role of Marketing - SummaryThe Role of Marketing - Summary